What Do Distributed Ledgers Mean for Data Centers?

What Do Distributed Ledgers Mean for Data Centers?

Why enterprise data architects do not have the option of disregarding this question.

My last installment discussing blockchains and other distributed ledger technologies (DLTs) dealt with their decentralizing potential. Indeed, while it’s mostly potential for now, it’s fair to say that it seems to be a solid one.

How do we know this? Just follow the money.

A recent article in Forbesindicates that DLTs are not a fad. Blue-chip companies are developing blockchain protocols for future business. Just the mere addition of the term blockchain to the name of a company makes companies money. In October of last year, when a British tech firm On-Line Plc added the term blockchain to its name, its shares surged by 394%. When Kodak announced earlier this year it would incorporate the blockchain protocol, it saw an over 200% increase in value overnight. IBM is working on a food safety blockchain pilot program with Walmart, Chinese e-commerce company JD.com, and the Tsinghua University in China. Investors (Google and Goldman Sachs among them) are paying serious heed to DLTs’ potential to disrupt traditional financial protocols and to create new markets. According to Research and Markets, the market for blockchain will rise from $2.5 billion today to $20 billion by 2025.

Bottom line? Any industry that places a premium on collecting and securely storing data from a great number of people while ensuring both confidentiality and transparency stands to benefit from the blockchain protocol. This has implications for Seagate’s customers and their worlds: enterprise data centers, IT architects, and the digital storage industry as a whole.

Some data centers are already involved directly in DLT-enabled mining of cryptocurrencies. But there are more general applications of DLTs relevant to data centers — their very bones, even.

In a world where nearly every news cycle alarms with stories focused on breaches to data, privacy is where it’s at. Considering the growing need for securing users’ data in the age of hacks as well as the exponential increase in traffic, data centers can learn from blockchain protocols. The software has already been built (thanks to R3, the Hyperledger consortium, and the Enterprise Ethereum Alliance). What remains are architecture and implementation.

“Not only must data centers evolve to meet the demand of higher traffic and more devices, but they must also prioritize securely storing users’ sensitive data,” writes Anthony Robinson in dotmagazine. “By transforming their architecture and adopting a blockchain strategy, they can take the next step forward to a completely connected society.”

But what happens to a data center that’s run on a shared ledger protocol? Can we still even speak of a data center?

In order to adapt, many data centers are transitioning from the traditional but increasingly inefficient 3-level tree network architecture model to the 2-level spine-and-leaf network structure, which is more useful for server-to-server data transfers.

Once the structural kinks are worked out, data center operators are likely to see more data center applications implementing “capacity planning, cooling, asset management, and virtualization on the blockchain,” all of which lead to lower costs, according to data center consulting firm instor. Cryptocurrencies such as Bitcoin, Ether, and Litecoin are likely to continue using data centers. This means that they’ll expose them to security risks that come with the lucrative excavations. Adapting DLTs can solve the security problem.

With the shift to cloud-based architectures, edge devices playing a critical role in networking, and data volumes and traffic ever on the rise, data centers, data architects, and the data storage industry need to adapt to ensure secure and speedy transfers of data. If distributed ledger protocols are indeed the future of cloud storage, and the shift to cloud storage continues, data centers and storage solutions companies will have to meet customers’ expectations for lower costs that DLTs are bound to create.

If so, the very nature of data centers might shift. Perhaps the data centers that adapt will incorporate DLTs — at least as an option on their menu of offerings.

One thing that’s certain? Data centers, IT architects, and the data storage industry might no longer have the option to disregard DLTs’ radical, decentralizing, disruptive presence.

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Agnieszka Zielinska is a senior writer and editor at Seagate. With a rich background in journalism, academia and marketing, Agnieszka is an expert researcher and applies these skills to help Seagate and our customers understand evolving technology applications. Finding fascinating stories and exposing them to light has always been a source of mirth and professional satisfaction for Agnieszka; her bylines as a writer and editor include Reuters News, The Wall Street Journal, The Chicago Tribune, Books & Culture, and the Huffington Post. Reflecting a great respect for global learning, Agnieszka speaks several languages, earned her master’s degrees in Political Science and International Relations from the University of Chicago and Northwestern University, and has taught classes in world politics, globalization, and Russian Literature.